David Wessel

1 week ago | brookings.edu | Tristan Loa |David Wessel

What is a budget baseline? A budget baseline is a projection of federal spending, revenues, deficits or surpluses, and debt, based on assumptions about the economy and trends in spending and revenues. Congress relies on baselines, often looking out ten years, produced by the Congressional Budget Office (CBO) and the Joint Committee on Taxation (JCT). This post explains the importance of baselines to the congressional budget process. How do current law and current policy baselines differ?

2 weeks ago | brookings.edu | Janice Eberly |Anil Kashyap |Jón Steinsson |David Wessel

At around $900 billion in transactions daily, the market for U.S. Treasuries is massive, not only in terms of quantity but also in terms of importance to the U.S. and global economies. The Treasury market is tied to interest rates, the value of the dollar, and financial markets around the world. So when shocks hit the Treasury market, as they did during the COVID-19 crisis, the ripple effects can be global.

4 weeks ago | brookings.edu | Alexander N. Conner |David Wessel

After the Russian invasion of Ukraine in February 2022, the U.S. and its allies responded with an economic toolkit designed to strengthen Ukraine and diminish Russia’s war-making capacity. Among the most potent of these tools was to freeze Russia’s foreign exchange reserves and use them as the basis for a large-scale loan to Ukraine. As the Trump administration pursues negotiations without America’s allies, the future of this economic toolkit is highly uncertain.

1 month ago | brookings.edu | Andre Perry |David Wessel |Fred Dews

... just as we can start these bad policies at the local levels, we can create inclusive policies at the local level. So that’s part of what the book does. It says here are people actually doing something to change the outcomes of Black people and communities. Andre Perry Historically, Black Americans’ quest for power has been seen as an attempt to gain equal protection under the law, but power in America requires more than basic democratic freedoms.

1 month ago | brookings.edu | David Wessel

What does “independence” mean? The Federal Reserve was created by an act of Congress in 1913 and, since 1977, has been charged with promoting maximum employment and stable prices. In practice, independence means that the Fed can set interest rates without interference from Congress or the White House even if politicians aren’t unhappy with Fed policy—and say so publicly. Congress could, of course, change the law, but no bill to alter the Fed’s mandate or governance has gone very far.